To be clear: Plan 9 is not limited to terminal-server setups. It can function just fine as a stand alone OS.
> As long as you have a CPU with an MMU and some RAM
Those weren't cheap at the time. If you read the Gnot terminal presentation (early Plan 9 terminal) it is stated that they were cheap enough so a user could have one at home and one at work. It also stated that some things could run locally like the text editor and compute intensive tasks like compiling could be exported to a big expensive CPU servers. These machines had a few megs of ram and a 68000 CPU and monochrome graphics. The CPU servers were Sun, DEC, SGI, etc, machines that users could certainly not afford one of, let alone two.
Proving this point, there are VNC client implementations that can run on MS-DOS machines.